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{{Distinguish|Black market}}{{Redirect|Dark market|the Internet forum|DarkMarket}} |
{{Distinguish|Black market}}{{Redirect|Dark market|the Internet forum|DarkMarket}} |
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{{Multiple issues| |
{{Multiple issues| |
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{{Refimprove|date=June 2007}} |
{{Refimprove|date=June 2007}} |
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==Description== |
==Description== |
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Grey market goods are legal, non-[[counterfeit]] goods sold outside normal distribution channels by entities which may have no relationship with the producer of the goods. This form of [[parallel import]] frequently occurs when the price of an item is significantly higher in one country than another. This commonly takes place with electronic equipment such as [[camera]]s. [[Entrepreneurs]] buy the product where it is available cheaply, often at retail but sometimes at wholesale, and import it legally to the target market. They then sell it at a price high enough to provide a profit but below the normal market price. |
Grey market goods are legal, non-[[counterfeit]] goods sold outside normal distribution channels by entities which may have no relationship with the producer of the goods. This form of [[parallel import]] frequently occurs when the price of an item is significantly higher in one country than another.<ref>{{Cite news|url=http://www.npr.org/sections/thetwo-way/2013/03/19/174757355/supreme-court-oks-discounted-resale-of-gray-market-goods|title=Supreme Court OKs Discounted Resale Of 'Gray Market' Goods|last=|first=|date=|work=NPR|access-date=2017-03-04|archive-url=|archive-date=|dead-url=|language=en}}</ref> This commonly takes place with electronic equipment such as [[camera]]s. [[Entrepreneurs]] buy the product where it is available cheaply, often at retail but sometimes at wholesale, and import it legally to the target market. They then sell it at a price high enough to provide a profit but below the normal market price. |
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International efforts to promote [[free trade]], including reduced [[tariff]]s and harmonised national standards, facilitate this form of [[arbitrage]] whenever manufacturers attempt to preserve highly disparate pricing. Because of the nature of grey markets, it is difficult or impossible to track the precise numbers of grey market sales. Grey market goods are often new, but some grey market goods are [[used goods]]. A market in used goods is sometimes nicknamed a [[green market]]. |
International efforts to promote [[free trade]], including reduced [[tariff]]s and harmonised national standards, facilitate this form of [[arbitrage]] whenever manufacturers attempt to preserve highly disparate pricing. Because of the nature of grey markets, it is difficult or impossible to track the precise numbers of grey market sales. Grey market goods are often new, but some grey market goods are [[used goods]]. A market in used goods is sometimes nicknamed a [[green market]]. |
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The two main types of grey markets are those of imported manufactured goods that would normally be unavailable or more expensive in a certain country and unissued securities that are not yet traded in official markets. Sometimes the term '''dark market''' is used to describe secretive, unregulated (though often technically legal) trading in [[commodity futures]], notably crude oil in 2008.<ref> |
The two main types of grey markets are those of imported manufactured goods that would normally be unavailable or more expensive in a certain country and unissued securities that are not yet traded in official markets. Sometimes the term '''dark market''' is used to describe secretive, unregulated (though often technically legal) trading in [[commodity futures]], notably crude oil in 2008.<ref>{{Cite journal|last=|first=|year=2008|title=Victory: "Close the ENRON Loophole" Bill is Small Step In Right Direction|url=http://www.nefi.com/NEON/NEON_issues/NEON_May_22_2008.html|dead-url=yes|journal=NEON: NEFI Energy Online News|volume=3|issue=19|pages=|archive-url=https://web.archive.org/web/20090107043624/http://www.nefi.com/NEON/NEON_issues/NEON_May_22_2008.html|archive-date=January 7, 2009|via=}}</ref> This can be considered a third type of "grey market" since it is legal, yet unregulated, and probably not intended or explicitly authorised by oil producers.<ref>{{Cite book |url=https://books.google.com/books?isbn=363821043X |title=Crime in Business - grey market products and EU-legislation |isbn=363821043X |access-date=28 February 2017}}</ref> |
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The import of legally restricted or prohibited items such as prescription drugs or firearms, on the other hand, is considered [[black market]], as is the smuggling of goods into a target country to avoid import duties. A related concept is [[Rum-running|bootleg]]ging; the smuggling or transport of highly-regulated goods, especially [[alcoholic beverage]]s. The term "bootlegging" is also often applied to the production or distribution of [[counterfeit]] or otherwise [[copyright infringement|infringing]] goods. |
The import of legally restricted or prohibited items such as prescription drugs or firearms, on the other hand, is considered [[black market]], as is the smuggling of goods into a target country to avoid import duties. A related concept is [[Rum-running|bootleg]]ging; the smuggling or transport of highly-regulated goods, especially [[alcoholic beverage]]s. The term "bootlegging" is also often applied to the production or distribution of [[counterfeit]] or otherwise [[copyright infringement|infringing]] goods. |
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Grey markets sometimes develop for [[video game]] consoles and titles whose demand temporarily exceeds their supply causing authorised local suppliers to run out of stock. This happens especially during the [[holiday season]]. Other popular items, such as [[doll]]s, can also be affected. In such situations, the grey market price may be considerably higher than the [[manufacturer's suggested retail price]]. Online auction sites such as [[eBay]] have contributed to the emergence of the video-game grey market. |
Grey markets sometimes develop for [[video game]] consoles<ref>{{cite web | title=China has finally lifted its 14-year ban on video games | website=Business Insider | date=July 27, 2015 | url=http://www.businessinsider.com/china-lifts-14-year-ban-on-gaming-consoles-2015-7 | accessdate=March 1, 2017}}</ref> and titles whose demand temporarily exceeds their supply causing authorised local suppliers to run out of stock. This happens especially during the [[holiday season]]. Other popular items, such as [[doll]]s, can also be affected. In such situations, the grey market price may be considerably higher than the [[manufacturer's suggested retail price]]. Online auction sites such as [[eBay]] have contributed to the emergence of the video-game grey market. |
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==Goods == |
==Goods == |
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===Stock market securities=== |
===Stock market securities=== |
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[[Public company]] securities that are not listed, traded or quoted on any U.S. [[stock exchange]] or the OTC markets are sometimes purchased or sold over the counter (OTC) via the grey market. Grey market securities have no market makers quoting the stock. Since grey market securities are not traded or quoted on an exchange or interdealer quotation system, investors' bids and offers are not collected in a central spot so market transparency is diminished and effective execution of orders is difficult.<ref>{{cite web|url=http://www.otcmarkets.com/otc-101/otc-market-tiers |
[[Public company]] securities that are not listed, traded or quoted on any U.S. [[stock exchange]] or the OTC markets are sometimes purchased or sold over the counter (OTC) via the grey market. Grey market securities have no market makers quoting the stock. Since grey market securities are not traded or quoted on an exchange or interdealer quotation system, investors' bids and offers are not collected in a central spot so market transparency is diminished and effective execution of orders is difficult.<ref>{{cite web|url=http://www.otcmarkets.com/otc-101/otc-market-tiers|title=Explanation of grey market securities|last=|first=|date=|website=|publisher=OTCMarkets|archive-url=https://web.archive.org/web/20120209051200/http://www.otcmarkets.com/otc-101/otc-market-tiers|archive-date=9 February 2012|dead-url=yes|accessdate=2012-01-27}}</ref> |
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===Textbooks=== |
===Textbooks=== |
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==See also== |
==See also== |
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{{Portal|Business and economics}} |
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*[[Regional lockout]] |
*[[Regional lockout]] |
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*[[White market]] |
*[[White market]] |
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==References== |
==References== |
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{{Reflist|30em}} |
{{Reflist|30em}} |
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==Further reading== |
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==Additional reference materials== |
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* {{cite web | author=McCauley, Dana | title=Chinese grey market a ‘$1 billion tax hole’ | website=Daily Telegraph | date=September 27, 2016 | url=http://www.dailytelegraph.com.au/business/chinese-grey-market-a-1-billion-tax-black-hole/news-story/2202ab7ad3b03345918667c958b265db | ref={{sfnref | Daily Telegraph | 2016}} | accessdate=February 1, 2017}} |
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{{Refbegin}} |
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* {{cite book |last=Hays |first=Thomas |year=2003 |title=Parallel Importation Under European Union Law |publisher=Sweet & Maxwell |isbn=0-421-86300-5 |type=hardcover |page=488}} |
* {{cite book |last=Hays |first=Thomas |year=2003 |title=Parallel Importation Under European Union Law |publisher=Sweet & Maxwell |isbn=0-421-86300-5 |type=hardcover |page=488}} |
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* {{cite book |last=Nissanoff |first=Daniel |year=2006 |title=FutureShop : How the New Auction Culture Will Revolutionize the Way We Buy, Sell and Get the Things We Really Want |publisher=The Penguin Press |isbn=1-59420-077-7 |type=hardcover |page=246}} |
* {{cite book |last=Nissanoff |first=Daniel |year=2006 |title=FutureShop : How the New Auction Culture Will Revolutionize the Way We Buy, Sell and Get the Things We Really Want |publisher=The Penguin Press |isbn=1-59420-077-7 |type=hardcover |page=246}} |
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* {{cite book |author=Michael Levy, Barton A. Weitz |year=1995 |title=Retailing Management Second Edition |publisher=IRWIN |isbn=0-256-13661-0 |type=hardcover |page=700}} |
* {{cite book |author=Michael Levy, Barton A. Weitz |year=1995 |title=Retailing Management Second Edition |publisher=IRWIN |isbn=0-256-13661-0 |type=hardcover |page=700}} |
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* {{cite book |author=David Sugden |year=2009 |title=Gray Markets: Prevention, Detection & Litigation |publisher=Oxford Press |isbn=978-0195371291 |type=paperback |page=360}} |
* {{cite book |author=David Sugden |year=2009 |title=Gray Markets: Prevention, Detection & Litigation |publisher=Oxford Press |isbn=978-0195371291 |type=paperback |page=360}} |
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{{Refend}} |
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==External links== |
==External links== |
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{{DEFAULTSORT:Grey Market}} |
{{DEFAULTSORT:Grey Market}} |
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[[Category:Distribution (business)]] |
[[Category:Distribution (business)]] |
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[[Category:Economic liberalism]] |
[[Category:Economic liberalism]] |
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[[Category:Free market]] |
[[Category:Free market]] |
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